Wells Fargo hit by legal costs, revenue misses Street view
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(Reuters) – Wells Fargo & Co (WFC.N) earnings scraped past Wall Street estimates but revenue missed for the fourth straight quarter, sending shares of the third-largest U.S. bank by assets down 3 percent in pre-market trading.
Total revenue fell 2 percent to $21.9 billion, hurt by a slump in its mortgage banking business. Income from mortgage banking plunged 37.3 percent.
Net income fell 18.6 percent to $4.60 billion, or 84 cents per share for the quarter ended Sept. 30, hurt by $1 billion in costs related to old mortgage problems.
Analysts had forecast earnings of $1.03 per share and revenue of $22.4 billion, according to Thomson Reuters I/B/E/S.
Wells Fargo’s operating efficiency ratio was 65.5 percent. Operating efficiency is a closely-watched metric that looks at expenses as a percentage of revenues.
Total expenses rose 8.2 percent to $14.35 billion. The bank has been trying to aggressively reduce costs in the aftermath of a fake accounts scandal that badly damaged its image.
Reporting by Sweta Singh in Bengaluru and Dan Freed in New York; Editing by Bernard Orr